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Important changes to Vehicle Excise Duty – Will the new car tax regulations affect you? - Blog Post

Important changes to Vehicle Excise Duty – Will the new car tax regulations affect you?

- 27-Feb-2017 -

Find out how much car tax you'll be paying next year...

In April this year, the car tax regulations are changing - How will this affect you?

The Vehicle Excise Duty, otherwise known as ‘car tax’ must be paid for by owners of vehicles which use the public roads, even if it’s parked and not in use for long periods of time (when a Statutory Off Road Notification is not in place).

Since the introduction of VED in 1888, there have been few and minor changes, until this year…

For vehicles registered from 1 April 2017 the cost of your car tax will be measured directly against the CO2 emissions of your vehicle for the first year of payments. Subsequent yearly payments will be standardised.

All other vehicles that are older than this will remain in the current costing system. HM Revenue & Customs puts it like this:

“This measure reforms Vehicle Excise Duty (VED) for cars registered from 1 April 2017 onwards. First Year Rates ofVEDwill vary according to the carbon dioxide (CO2) emissions of the vehicle. A flat Standard Rate (SR) of £140 will apply in all subsequent years, except for zero emission cars which will pay £0. Cars with a list price in excess of £40,000 will incur a supplement of £310 on theirSRfor the first 5 years in which aSRis paid. All cars registered before 1 April 2017 will remain in the currentVEDsystem, which will not change.”

New VED system – for cars registered from 2017

How will the new car tax regulations affect me?

It should be highlighted, that no-one will end up paying more car tax for a vehicle they already own. In fact, the government have summarised that the financial impact to the family will be minimal, unless you buy a new car after 1 April 2017, valued at more than £40,000. On average, we pay £166 a year for car tax, and so you may well be better off over time. Moreover, this is also expected to have a positive effect on inflation, with expected ‘behavioural changes’ accounting for an increase in vehicle purchases before the changes take effect.



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